Money Laundering case: Kerala High Court Grants bail to suspended IAS Officer

Money Laundering case: Kerala High Court Grants bail to suspended IAS Officer

The Kerala High Court by a single judge, Justice Ashok Menon granted bail to suspended IAS officer – M Sivasankar – Former Principal Secretary to the Chief Minister of Kerala who was arrested by the Enforcement Directorate (ED) on 28th October 2020, in the money laundering case registered in connection with gold-smuggling in the state.

In a relief to the IAS Officer, the Additional Chief Judicial (Economic Offences) Court, Ernakulam, also granted him default bail in a case registered by Customs in connection with the smuggling of gold.

On 28th October 2020, the High Court had dismissed Sivasankar's anticipatory bail plea in the ED case observing that there were circumstances suggesting that he might be involved in money laundering with Swapna Suresh. The case related to the seizure of thirty kilogram of twenty-four carat gold worth Rs. 14.82 crore at Thiruvananthapuram airport on 5thJuly by the Customs (Preventive) Commissionerate, Kochi, which was sought to be brought through the diplomatic consignment sent to UAE consulate at the State Capital.

Later on, Sivasankar was believed to be under suspicion on account of his interconnection with the prime accused in the gold smuggling case, Swapna Suresh and P R Sarith. Subsequently, the reports about gold smuggling surfaced in media, the state government suspended him from service July, 2020 for alleged violations of conduct rules.

The Court passed the following order:

"There is no doubt about the complicity of the applicant and there are no reasonable grounds to believe that he is not guilty. However, it should alsobe considered whether there is a likelihood of the applicant committing any offence while on bail. I am afraid that the prosecution has not been able to establish this fact. Going by the allegations made by the ED, the applicant was indulged in laundering of 64 lakhs which was seized from the SBI locker. ₹ There is no indication that the applicant had anything to do with the locker belonging to A2 in Federal Bank. Thus, the proviso to Section 45 (1) of the PMLA would operate in view of the fact that the money allegedly laundered is less than rupees one crore".

In addition, the Court noted that restriction under Section 45 (1) under the Prevention of Money Laundering Act, 2002would continue to stand in the way of granting bail to the applicant except under the conditions mentioned therein.

High Court also pointed out that, "the applicant has been in custody since 28th October, 2020. He has been subjected to interrogation including custodial interrogation in a number of times. The present pandemic times also does not encourage incarceration of an accused indefinitely. I find no rationale for continuing the applicant's judicial custody as an undertrial in this case. The applicant is therefore, entitled to be released on regular bail on stringent conditions".

With these observations the High Court felt that the bail application needs to be allowed and directed the IAS officer be released on bail on execution of bond for Rupees five lakh with two solvent sureties for like amount each to the satisfaction of the jurisdictional Court subject to further conditions.